Thursday, December 4, 2014

Who is John Galt? How Corporate Dental Offices are Disrupting the Status Quo.

Who is John Galt?
Disruptors in Dentistry
By Brett Kessler, D.D.S., CDA President

"I started my life with a single absolute
That the world was mine to shape in the image of my highest values
And never to be given up to a lesser standard, no matter how long or hard the struggle" Ayn Rand, Atlas Shrugged

Disruptors are innovators.  They are businesses that shift a mindset of how consumers think, purchase, etc. – thereby challenging established businesses.

Harvard Business School professor and disruption guru Clayton Christensen says that a disruptor displaces an existing market, industry, or technology, and produces something new and more efficient and worthwhile. It is both destructive and creative.

Some examples of disruptors are companies like Apple, Netflix, Amazon, and Uber.

I identify Apple not for the computers that it builds, but for another niche that it took over – music and listening device sales.  iPods, iPhones and iTunes have changed how we buy and listen to music. There are hardly any CD stores remaining other than those that sell used discs.  When I grew up, I would buy records.  The cover art would attract me to give new bands a listen.  I judged the band by entire albums that it recorded.  Today, we buy songs, not albums. They are instantly downloaded onto our computers.  No waiting in lines; no browsing through tedious shelves of records/CD’s.

We create playlists with the drag of a mouse.  We use auto shuffle and the “genius” feature to create our own personal radio stations. They connect to our cars, our phones, our tablets and all are stored on our computers.  CD players are becoming a thing of the past.  Music is stored on hard drives, flash drives, iPods, etc.

Netflix took how we rent movies to a new level.  For a low monthly fee, we can have unlimited movies shipped to our house – hassle free – or immediately available to view on our computer or smart TV’s through an internet connection.  Blockbuster used to charge late fees, “you-didn’t-rewind-the-VHS” fees, etc.  I dreaded having to pay this fine. The buying experience was a hassle and expensive.  Netflix is easy, customized to my preferences and instant. Are there even any Blockbuster stores left?

Amazon capitalized on the fact that a book is still readable after it had been read, music is still listenable after it had been listened to, and anything should be able to be purchased on the internet easily!  They created a personalized buying experience based on your browsing and buying habits.  It greatly affected the big chain bookstores like Borders or Barnes & Noble.  It also helps you find the lowest price for a commodity and they deliver it right to your door.  If it wasn’t exactly what you were looking for, ship it back.  Hassle-free!

Lastly, Uber is putting a huge dent in the taxi business. With Uber, you can press a button on your phone app and a nice clean car will be at your location within 15 minutes. Taxi’s get to you when they get to you and the entire cab experience pretty much stinks!

All of these disruptors have innovated, streamlined and penetrated market share. They have challenged and even ruined wildly successful businesses, while reinventing the delivery of these services.  They have changed the consumer’s mindset and changed the paradigm on how these services should be purchased, used and consumed.  The consumer experience is exactly the way the consumer prefers.  We (the consumers) wouldn’t have it any other way.

Another commonality of these disruptors is that they didn’t just enter the marketplace and were welcomed with opened arms.  The status quo or “established” business model was not happy and tried to stop them.

In reality, the status quo was asleep at the wheel. They were lazy and arrogant. They felt they were too big to fail. Those established business models that survived disruption evolved their business models to better serve their consumers.

The question, “Who is John Galt?” comes to mind from Ayn Rand’s book “Atlas Shrugged.” John Galt represents creativeness and innovation.  In the book, the status quo was constantly putting up barriers to protect its own interests in how things always have been done.

The status quo must constantly channel its inner John Galt if it wishes to remain relevant to the people it serves.

There are disruptors popping up in every niche of business, and dentistry is definitely not immune. 

Large Group Practices, better known as Dental Support Organizations, are delivering dental services cheaper, quicker and more efficient than the typical private practice. A Dental Support Organization takes care of all of the business aspects for the dentist – the billing, HR, marketing, equipment, materials, etc. 

They are aggressively growing around the country.  They are aggressively hiring new dentists.  They are aggressively advertising their services.  They have created a niche for themselves and continue to attract patients.  Some may say that they haven’t perfected the consistent customer experience yet, but at some point, this too will change.

As in private practice there are good practitioners and those who could use a little nudge to “up their game.”  The reality with the Dental Support Organizations is that they are being judged by the lowest common denominator.  For every bad patient experience, the entire organization’s reputation takes a hit. If these companies are going to take their disruption to the next level, they need to shore up some of the weaker links in their organizations.  Trust me; they are aggressively evolving their internal practices to do just this. 

I recently attended a forum on Dental Support Organizations. DSO’s are growing 15-20% per year with over 7000 dentists employed, it was illustrated that the trend in healthcare is moving toward consolidation.  Consolidation breeds efficiency, in theory.  If you look around, there are very few privately owned pharmacies; there are very few private physician offices.  They have all been engulfed by corporate entities that manage the business side of the practices. Has it improved healthcare? I’ll leave that for the reader to decide. 

Many of us in private practice (the status quo) are complaining.  Of course, it’s only natural.  The realities are, however, if the private practitioners aren’t evolving their games, they will soon be wondering where their patients have gone. Maybe some of us already are!

Graduating dental students are being hired in droves by these practices.  I asked a recent graduate who was working for a Dental Support Organization what his favorite part was about working in this environment?  He answered that he has mentorship and professional networking instantly available to him.  He admitted he gives up some of his autonomy, but implied that no job is 100% perfect.  I would agree with that statement in private practice too.  There are parts of my day that I don’t look forward to doing (usually administrative) as well. 

Most of these dentists are not joining organized dentistry.  Why?  The most common response: they are made to feel “less than” for working for those companies. 

This must stop.  We (organized dentistry) are being judged by this fact, just as some may be judging those who work for entities different than private practice. The Colorado Dental Association is charged with advancing oral health in our state.  The DSO’s in Colorado are helping us achieve this.  They are just doing it differently than the “status quo”.

We need to be much better at welcoming our colleagues.  They are working the best that they can with the opportunities that are presented to them.  I always remind young dentists to keep the patient’s best interest as their main focus.  We have a must maintain our code of ethics as a profession.

The Association of Dental Support Organizations ( has emerged to help set standards for it’s members and is looking to ensure that ethical practices are in place.

Evolution is the survival of the fittest.  Those who can adapt and create change will evolve into the new paradigm, and address the needs and desires of the consumers.

The status quo does not exist indefinitely.  It will constantly be challenged.

“Who is John Galt?”

Disclaimer: I am not passing judgment on these disruptors mentioned in this article.  I am just sharing my observations and thoughts.  I may or may not subscribe philosophically with various paradigm shifts occurring in the dental marketplace.  Each serves a niche that is attractive to various people.  That is why they are growing/gaining the market share and shifting the perceptions of the consumers. When I mention “organized dentistry” I mean ADA, state associations and its components.

If you like this blog post, I would love to hear about it.  Please comment or share it on Google+, Facebook, Linked in, Twitter, etc.  If you are looking for a dentist in the Denver area, we are always looking for new patients.  Please visit our website or like our facebook page,  Or you can contact us  the old fashion way - call us at 303-321-4445.

Thanks for reading!  BK